Inside Energy: Not in my backyard?

Oil and gas booms can seem remote -- it’s not like they happen in your backyard.

Unless they do.

Take Laramie County, Wyoming, where a surge in well permitting is threatening to bring drilling closer to a large number of homes. Although Wyoming has a long history with oil and gas, it’s almost always been in rural areas. Wyoming Public Radio’s Stephanie Joyce reports for Inside Energy that some say the state is ill-prepared to deal with the issues that arise when communities bump up against drilling.

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In May of 2013, oil and gas companies applied for nine permits to drill in Laramie County. In May of 2014…

“Laramie County had 132 drilling permits.”

That’s Wyoming Oil and Gas Supervisor Mark Watson. He says it’s not a boom quite yet… but its close..

“You know, the companies that are down there are serious about eventually drilling those wells. They just need to learn more about the formation.”

The formation being the Codell, a deep sandstone reservoir that has market analysts gushing. Bloomberg News recently reported that even companies that are traditionally conservative in their assessments are saying the Rocky Mountain region has as much potential as the better-known Bakken in North Dakota or Eagle Ford in Texas. But here’s the problem, in Laramie County, the promising reserves happen to overlap with places where lots of people live.

“That’s getting to be a big issue."

The city of Cheyenne, for one.

"Colorado is already dealing with it, and now it’s probably going to be an issue in Laramie County because they’re drilling close to people’s houses.”

Houses like Deb Schauermann’s. She bought property near Cheyenne last May.

“Moved up there with my two horses, built a barn, put in fences.”

A few weeks ago, workers started staking out the adjacent property. She found out EOG Resources has plans to put in as many as 32 horizontal wells. The closest well pad would be several hundred feet behind her house. Schauermann says it never occurred to her when she bought the property that drilling could someday happen in her backyard … and she’s worried.

“The health impacts, all the flaring and all the chemicals that are going to go in.”

Hoping to get reassurance about some of those concerns, Schauermann was one of two dozen landowners who attended a meeting recently about preparing for oil and gas development. She was given lots of advice...

“Being vigilant, taking pictures, calling people. I mean, I didn’t know that you should probably do all that stuff, so this has been very, very helpful, because I was feeling pretty helpless.”

Schauermann doesn’t own the mineral rights beneath her property, so she won’t profit at all from the new development.

Jan Beeken, on the hand, does own the minerals on her property outside Cheyenne, and is planning to lease them to an oil and gas company. But she thinks the state needs stronger regulations… and enforcement of them.

“You know, I understand the need for drilling and oil and gas in Wyoming… it supports the economic base for the state. There just need to be controls in to protect the workers, to protect the people and to do it right."

Wyoming’s rules for how far a well has to be from a house -- the setback -- haven’t been updated since the 1970s. While in many places in Texas, the setback is 1000 feet and in Colorado, it’s 500 feet… in Wyoming, it’s just 350 feet. The state’s regulations governing the flaring or burning of natural gas from oil wells also haven’t been overhauled in decades. The Oil and Gas Conservation Commission plans to review the setback rule this year, but in the meantime some are calling for a moratorium on drilling in Laramie County.

Jill Morrison is with the Powder River Basin Resource Council.

“The state has got to get out in front of the development to address the impacts that are going to occur to people, to property and local governments, and right now, we're not there.”

But it’s not immediately clear who would have the authority to impose a moratorium. James Kaste, the deputy attorney general for natural resources, says he’s never been asked the question before. And Watson, the oil and gas supervisor, says he doesn’t have the authority.

“If a company comes in with a drilling permit and they meet all the requirements of our current rules, I have to, by statute, approve that drilling permit. I can’t just say no.”

But Watson is beginning to negotiate with companies. He says just recently, he asked a company in Laramie County to move their wells further back from a house and put up better noise barriers. It may have been a first -- historically oil and gas supervisors haven’t acted as go-betweens for companies and landowners -- but it’s not likely to be the last.